An informed and thought-provoking analysis of what lies behind the headlines and headaches of business ethics and corporate social responsibility

Thursday, January 21, 2010

Cruising to the quake?

In the aftermath of the Haiti earthquake last week a very interesting discussion on CSR has arisen. While thousands of people are suffering, lacking medical care, let alone shelter or food, cruise ships from all over the (developed world) keep arriving in Haiti, albeit it not in the direct earthquake stricken zone around Port-Au-Prince.Many newspapers reported about this and the debate whether it is good taste, let alone ethically sensitive, to have people dining and wining in the resort of Labadee while 160 kms to the South people have hardly anything to eat for their naked survival. The case raises a typical dilemma for business ethics which shows how important moral imagination and a sound command of ethical theories can become for a company.Royal Caribbean International, one of the companies whose ships still dock in Haiti, takes a clear utilitarian stance on this. Their CEO was quoted saying:

"My view is this -- it isn't better to replace a visit to Labadee ... with a visit to another destination for a vacation. Being on the island and generating economic activity for the straw market vendors, the hair-braiders and our 230 employees helps with relief while being somewhere else does not help. People enjoying themselves is what we do. People enjoying themselves in Labadee helps with relief. We support our guests who choose to help in this way, which is consistent with our nearly 30-year history in Haiti."

Indeed, cruise liners bringing business to the island is resulting in the ‘greatest good for the greatest number’, compared to them stopping it or going elsewhere. But it seems to be more a question of fairness and equity, which raises the eyebrows of some commentators. In some ways, the strongest argument comes from what we refer in our book to as the ‘postmodern’ view on ethical questions, as one blogger put it:

"To me it's like going to a funeral and singing and dancing around the casket."

Yesterday in the Canadian News they showed thousands of people sitting in the port of the capital but unable to leave the country because of lack of fuel. Watching a white cruise ship with a nine hole golf course swiftly gliding by is not what these people need right now. Maybe the fact that people ‘enjoy’ themselves in poor countries is a problem in the first place. The earthquake just makes this unfair and unequal distribution of wealth on the globe just that little bit more visible. Even on a normal day in Haiti, there is still this grotesque gap between luxury on the ships versus abject poverty starting meters away from the fence of the resort in Labadee. Why else would one need to guard it by armed security even on a normal day?

For companies such as RCI these are no easy times. But they are in the moral maze of solving this dilemma, as it were by default. And one cannot say they are not trying, having also pledged $1m in food relief which they will deliver with the help of a local NGO. Engaging in blogs, working with local players and to find a pragmatic solution on the ground, reflects some lessons in discourse ethics. At the end of the day, RCI's behavior just reflects the demands of their stakeholders, most notably their customers: only very few of RCI’s customers are reported to have cancelled their cruises...(We would like to thank our colleague Nancy Sutherland at Schulich for alerting us to this story.)

7 comments:

Thanks for your balanced comments on this. It's a very sensitive issue, and I've been trying to encourage people to be cautious about reaching snap decisions about what "looks" or "feels" out of place.

Chris,congrats for CNN picking up your blog. i liked your point about that the main problem with this persists and has always been there. Btw, we just sent off 3rd edition of our text, with a new Ehtics online feature, in which also mentioned your blog.

I've been following this cruise-ship-on-Haiti issue and I haven't seen two issues discussed at all.

1) This is touched upon in this post, but rarely elsewhere: Haiti was destitute before the earthquake. Was it CSR-kosher to parade the big white ships with frolicking (mostly) big white people then?

2) What do the Haitians think? We are driving ourselves crazy with the moral dilemmas but what gives us the right to know "what these people need right now"? (Other than that we know what's needed in the disaster relief effort.) My guess is, right now the unfortunate people of Haiti don't care about cruise ships because they have bigger issues to deal with.

I think its very important for the cruise ships to come into Haiti and also for this issue to be heard on a much bigger forum.

Giving business ethics its due respect, it is also important that we look at this issue in a very practical regard.

Haiti has had a natural disaster and need a long term rebuilding process. A very important player in this process would be the tourism industry which is Haiti's main source of income. It is important that the monies from RCI keeps coming into Haiti for their long term development. It is very heartening to see that RCI are planning on making a lot of donations as well.

Metaphorically speaking, consider the situation in Pakistan or the situation in the Gaza strip where we come across the man made disasters like the Taliban and the war between Israel and Palestine. Did that stop or is that stopping the corporations to invest in these countries and/or conduct business in the same?

The situations are the same and people have been killed and are still being killed while I am penning this down, but that does not stop the daily business, because the business the means to livelyhood and the means to survive.

Another example is the situation I experienced recently in my work in a multinational organization. Labourers who were diagnosed with H1N1 flu would come to work and attend to their duties inspite of the threat of spreading the flu to others, because their livelyhood depended on them. They could not or did not have the facility to sit back and get themselves cured for 15 days because that would mean that they would lose out on 10+ days of their wages. They would not inform the authorities of them having the disease and would just carry on with work, even after a lot of requests.

In the modern global world that we live in, it is very important to keep walking and not stand still. A very successful and ethical company that I worked for believes in celebrating gains or feeling disappointed over losses for a couple of minutes and then carry on with work.

I feel in the case of Haiti, it should be the same. Its hard to put it in practice with all the emotions everyone in Haiti must be going through, but the earlier they put it back and work for their nation, the better it is.

I feel RCI's approach to continue with its operations in Haiti is a very positive one and one that shows the nation the right way to stand back on its feet. Aid will arrive and will stay for a lot of days, but at the end of all these days, its Haitians who have to stand back on their feet and face the challenges. Stopping RCI's ships would only increase those challenges.

I am not trying to sound militaristic, but am looking at the positive side of it, and hoping that Haitian's get over the difficult bit of controlling their emotions and start thinking positively towards the future and building their country back to how it was. Its a testing time for the lucky ones who survived the earthquake and all our prayers are for them and for the development of positive thoughts in them and the corporations that work with them.

Abhinandan,great comment, really like it. thing is, you are emphasising the utilitarian perspective: in the sum, more people benefit from cruises continuing, then from stopping them for a while. so far so good.why i find this case interesting to talk about is this: its not that simple. we as humans have the fundamental trait of empathy. and that would make you (and me) very uneasy, to slurp oysters and sip champagne, while a few meters away dead bodies are dragged out of the rubble.

my issue is this, as examplified by your H1N1 example: what are the economic conditions and systems we are working in? if these guys had a good health system, which allowed them to call in sick and not loose pay (let alone their job), this would not be an ethical issue. and in some parts of the world, such as europe, this is still the case. the same with Haiti. i think the problem is, that even without the quake, we in the 'developed' world are so used to just accept that 80% of teh world population dont share our wealth, but we are still happy to 'enjoy ourselfes' as teh RCI chairman put it, next to their plight.all i am saying is, yes, in the short term and under the given circumstances i agree to teh approach of keeping the cruises going. but we should not miss this dilemma as an opportunity to think bigger. we (more you i guess, given my age) are the next generation and we have a voice and influence how we want the world to look. and clearly these blatant clashes of wealth and happiness are not what i want to live with. and i also know you. so lets use such opportunities to dream...thanks again for engaging with this. i really like what you wrote and the way you take charge of issues like this!

Dirk, Thank you for your reply. I have always enjoyed attending your lectures at RHUL and also loved reading your book. Its a real pleasure that I am able to discuss such issues with someone as knowledgeable and intellectual as you thanks to this blog.

Reading your reply gets so many thoughts into my mind which I would like to share...

As a kid, I remember reading a story about a man who comes from a starving village to a city to make money to feed the people from a village. When he comes to the city, he sees that there are people eating good food and also people who are starving. At first, he does not understand how people are willing to allow food to rot in food stalls rather than feed it to the hungry. But living in the city for a few days, he realises that unlike his village, the city does not give him food unless he gets an opportunity to work and also takes up the opportunity. The reason behind the story is that it gives a clear picture about the society we live in...like you said with the developed world not caring about the 80%. Its totally true. I agree that it is not easy and/or simple to ignore the fundemental trait of empathy, but at this point in time, the world we built in forces us to do so and carry on with it. Maybe its a sign from nature telling us that we have created a world that needs a bit of a change. A change through which everyone's mindset has to go through and a change after which we will all be living in a world wherein the fundemental traits and principles of humanity are valued.

In my opinion, the change can only start when there is equal distribution of knowledge. Equal distribution of money is important but not as important as the equal distribution of knowledge. I would like to compare the situation in Haiti before or after the earthquake to the situation in India around 15 years ago. We were just the same. We had huge debts from the world bank and we had severe famine in many parts of the country. When the internet revolution happened, more people had the access to gain knowledge which told them ways to plan and develop themselves and improve their standard of living. A lot of people are still living under the poverty line as of today, but a lot of people have come out because they were shown the right way forward.Speaking of knowledge, it is important that the knowledge of ethical behaviour is also inculcated into people and corporations for safeguarding the basic values.

With respect to the H1N1 situation, we had a very good health system except that a few bad apples in the organization would not allow that to be perfectly put in place. That left us open to such a scenario and we faced quite a bit of a problem when H1N1 was on the rampage. Again a lot of these problems would have been subsided had it been that we were dealing with knowledgeable and better educated people.

I totally agree that we should use this opportunity to dream and would also like to add that we should BELIEVE in ourselves to make this dream a reality. I have started the and been a strong campaigner for the ‘I BELIEVE’ campaign which states that if you develop a strong belief that something will happen, you will develop the positive attitude to make it happen.

I therefore believe that an ethically correct society is right around the corner. It will take us a lot of work to get there but it isn’t difficult to reach there.

In my opinion, the earthquake in Haiti provides a good example of the idea of “moral intensity” proposed by Thomas Jones. Before the earthquake people have been dining and wining in Labadee without caring for the poor-living conditions of their close neighbours.

Isn’t Haiti the poorest country in the American continent? Does it make a difference whether we are dining and wining in Labadee, Punta Cana or in Stockholm? It seems that a calamity has to happen in order to get the attention of the media and to start thinking whether is ethical to be enjoying life in Haitian resorts or on a Cruise close the shores of a misfortune nation. And it seems that only people dining close to epicentre have to be ashamed of such an act? Why shouldn’t a person having a fine dinner in New York be exonerated from the shame?

I really like the Utilitarian perspective. It makes sense to me that people can contribute to the situation in Haiti by spending their holidays (and their money) there. However, does the utilitarian perspective really work in practice? How much of the revenues of international tourism companies operating in Haiti do actually stay in the local community or in the Haitian national economy at all?

It’s common that most of the revenues coming from the tourism industry go outside the destination. We could reflect upon how the cruise company has improved the life of Haitians before the earthquake? Perhaps utilitarianism may work if a share of customers’ expenditures would directly go to the local community. In this case it would make sense to go to Haiti and spend money there, even in spite of the earthquake.

So far, it seems that RCI has been engaged in philanthropic acts. In the company Website, they state:

“We provide monetary funding and in-kind cruise donations to nonprofit organizations, and we also organize annual volunteer days around the world.”

Is altruism a solution to the problems of Haiti? Could this approach be based on ethical egoism? I mean by donating funds the company is doing its share and gain legitimacy for continuing their “business as usual”. What about a more pro-active approach? Couldn’t the company make Haitian social and environmental issues part of their business strategy? I think that such an approach would better support the utilitarian perspective.

What about dining, wining and spending a nice holiday in Malawi or Somalia? Do these countries need a natural catastrophe of a large magnitude in order to launch moral deliberation?

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Andrew Crane [L] and Dirk Matten [R]

Welcome to the Crane and Matten blog - for informed commentary and expert analysis on the everchanging world of corporate responsibility.

We are two business school professors best known for our books and research articles on business ethics and corporate citizenship. We wrote the Crane and Matten blog from 2008-2015, offering unique insight on a range of issues from across the globe.

Andrew Craneis Professor of Business and Society in the School of Management, University of Bath.

Dirk Matten is the Hewlett Packard Chair in Corporate Social Responsibility in the Schulich School of Business, York University.